Frankfurt, May 2 Amidst rising concerns over the coexistence of the Asian Development Bank (ADB) and China-backed Asian Infrastructure Development Bank (AIIB), the multilateral development banks have signed memorandum of understanding (MoU) today to strengthen their cooperation for sustainable growth. ADB President Takehiko Nakao and AIIB President Liqun Jin signed the MoU on the sidelines of ADB’s 49th Annual Meeting of the Board of Governors. ADB and AIIB have agreed to strengthen cooperation, including co-financing, at the strategic and technical levels on the basis of complementarity, value addition, institutional strengths and comparative advantages, and mutual benefit, the MoU states. The agreement sets the stage for jointly financing projects. ADB and AIIB have been discussing some projects for co-financing in the road and water sectors. The first project under joint financing is expected to be Pakistan’s M4 highway project, a 64-km stretch of motorway connecting Shorkot to Khanewal in Punjab Province. “ADB and AIIB had been holding discussions regarding joint financing since last year and we have picked the Pakistan’s project because it is more mature than other projects,” said Nakao. ADB has partnered with AIIB especially for the implementations of the projects through co-financing because both have similar safeguard policies. As China backed AIIB has been established recently and is in the process of recruiting human resources, ADB will take a greater role in administering the projects that are to be initiated in the near future. “I am delighted to take a step further in our partnership with ADB,” Jin, president of AIIB said, adding, “AIIB looks forward to deepening our already strong relationship and expanding our collaboration as we seek to address the significant infrastructure financing needs in the Asia region.” Through co-financing, knowledge sharing, and joint policy dialogue with member countries, the two institutions will work together in areas including energy, transportation, telecommunications, rural and agriculture development, water, urban development, and environmental protection. Both institutions will undertake regular high-level consultations and joint data collection to promote the implementation of the Sustainable Development Goals and the Paris Climate Conference (COP21) agreement. ADB has also aimed to expand its annual lending portfolio as it has agreed to merge Asian Development Fund (ADF) and Ordinary Capital Resources (OCR) next year. “We will be able to expand our annual loan and grant approvals from $13 billion in 2014 to more than $20 billion by 2020,” said Nakao. “Seventy per cent of the assistance will be provided to the poor countries of Asia and Pacific.” ADB has urged the economies of the Asia-Pacific to maintain sound macroeconomic policies, increase investment in infrastructure, human capital and technology, develop efficient financial markets and improve business climate to realise their full growth potential. Frankfurt declaration FRANKFURT: As the governors of all 67 members states of the ADB have gathered here to determine the future direction of the Asian development financing, the government of Germany has pledged to work together in a push for sustainable development. The Ministry for Economic Cooperation and Development (BMZ) and ADB have signed a joint declaration on Monday in the presence of German Chancellor Angela Merkel. Through this Frankfurt Declaration, both signatories have agreed to work together to jointly drive forward climate protection and vocational training education and training in Asia. BMZ is engaged in supporting a wide range of projects in Asia, including measures to promote renewable energy and efforts to establish fair social and environmental standards in global supply chains. After signing of the declaration, the annual meeting of the ADB board of governors will focus on European-Asian economic and financial cooperation. The focus will be on getting partners from the private sector more closely involved in realising global development sustainability goals, cooperation projects and business models. The ADB and BMZ will work together to bring about further improvements in working conditions in Asia. The BMZ is lobbying to get internationally recognised core labour standards of International Labour Organisation. Gerd Müller, Germany’s federal minister for Economic Cooperation and Development (BMZ) has said that the ADB and BMZ’s partnership charts a new course for the equitable development in Asia. Green climate financing to be doubled by 2020 FRANKFURT: Asian Development Bank (ADB) has announced it would double the annual green climate financing to $6 billion by 2020 for the mitigation and adaptation of the climate change risks. “ADB’s spending on tackling climate change will rise by around 30 per cent of its overall financing portfolio by 2020,” said Susantono Bambang, vice president for Knowledge Management and Sustainable Development. ADB has also prioritised expanding the level of co-financing with multilateral development banks and leveraging resources from private sector to achieve the desired development outputs in days to come. As per Bambang, ADB’s annual loan and grant under this facility of green climate fund will hover around $4 billion in mitigation that features scaling support for renewable energy, energy efficiency, smart cities, sustainable transport, among others. Moreover, $2 billion would be for adaptation, which features climate smart agriculture, disaster risk reduction, among others.